Typical length of a bear market

We recently spotted a very good piece on the typical length of a bear market. Mark Hulbert wrote a very descriptive article in the Wall Street Journal earlier this week – http://www.wsj.com/articles/bear-markets-can-be-shorter-than-you-think-1457321010 – where he shared research showing the typical bear market recovery happens on average, in 3.1 years. That means it only takes ~3 years for stocks to recover to where they were before the bear market started in the first place.

We are sharing this now because inevitably, when the market declines again in the future, investors will get squirrely and sell their positions “just because they are down.” It’s important to control emotions, know what you own, and have a plan in place to withstand the occasionally bumps in the road. If ones investment plan seeks to own stable, growing, fairly predictable, and shareholder friendly businesses, time is most definitely on the side of the patient investor.